Well, the reason why the bank's stock just tumbled to fresh multi-year lows, and just on top of John Paulson's cost basis is a report from Bloomberg's Hugh Son which confirms our worst fears about the bank:

"Bank of America Corp. (BAC) may have to build its capital cushion by $50 billion and renege again on Chief Executive Officer Brian T. Moynihanís pledge to raise the firmís dividend as mortgage losses drain funds."

Next up, after investors balk to buy bonds from the firm at preferential rates, is Bank of America coming to market with another equity raise in full confirmation that the emperor is indeed naked... and Moynihan is about to be sacked.

yea, I am honestly at the point where I just don't care any more. The corruption is so rampant and obvious and the sheeple just don't seem to care. They are more concerned with who is winning Americas got Talent or dancing with the stars. Its ashame, I almost want to see a collapse so the sheeple are caught with their pants down.

While the company reported an adjusted EPS of $0.33 which shockingly came at the "at the high end of the prior guidance on June 29, 2011 when the company said net income excluding mortgage items and other selected items would be between $0.28 and $0.33 per share" the truth is that of the $5.6 billion in adjusted pretax net income, $3.3 billion was the result of credit loss releases.

In other words 59% of the firm's "adjusted EPS" came from an accounting treatment and the CFO's interpretation of improving credit trends.

As for the balance: another $1.5 billion came from a write-down in Mortgage Servicing Rights or another accounting gimmick.

So take away the reserve release and MSRs, and one gets an EPS number that is 86% lower than the disclosed or about $0.05.

The problem is that on an andjusted basis, the EPS was ($0.90) or a loss of $12.6 billion pre tax, driven by the previously disclosed settlements and a surge in provisions for Rep and Warranty settlements to $14 billion.

Keep in mind this number will be far, far higher when all the Countrywide litigation is said and done.

After all, the firm itself said that the "Estimated range of possible loss related to non-GSE representations and warranties exposure could be up to $5B over existing accruals at June 30, 2011.

This estimate does not include reasonably possible litigation losses." So what about litigation losses?

Well at $1.9 billion this was a huge surge from the $0.8 billion in Q1 and $0.6 billion Q4 2010.

This number will also only go up as everyone and the kitchen sink sues Bank of America.

And while one can play accounting games to paint the EPS tape, the cash that leaves the company is all too real:

the firm's Common Equity Ratio plunged from 9.42% in Q1 to 9.09% in Q2, the lowest since Q2 2010, and the result was a plunge in the firm's (very much meaningless courtesy of Mark to Market being illegal - thank you FASB) Book Value per Share to $20.29: the lowest in well... ever since the firm's bailout by the US taxpayer.

Investors in Countrywide Financial Corp. mortgage bonds may be owed three times or more of what theyíre being offered in an $8.5 billion settlement with Bank of America Corp. (BAC), a group of Federal Home Loan Banks said.

The home loan banks, which invested more than $8.8 billion in the mortgage-backed securities, are trying to get access to more information about the deal by joining the case and said a reasonable settlement could range from $22 billion to $27.5 billion or more.

From ThomsonReuters Research comes this eye-popping factoid: The S&P 500 earnings growth rate in the second quarter was a robust 15.2%.

EXCEPT, it wasnít.

That number doesnít count Bank of America Corp. BAC which took a $9.1 billion loss during the second quarter due to a mortgage settlement. Including the Charlotte, N.C.-based bank, the S&P 500 SPX only showed 9.2% growth.

Yes, B. of A.ís loss was enough to shave a third of the overall earnings growth for the nationís 500 biggest companies.

B. of A. didnít just drag down the broader corporate earnings growth rate. It took a positive quarter for the financial industry Ė up 4.9% without B. of A. Ė and turned it into a 29.4% loss.

The bank might have dragged down the entire corporate profit engine had it not been for the materials and energy industries which showed 48% and 36% earnings growth respectively.

Wow, that sure was a long time ago, lol. Do you remember where you were the day the FED was founded?

1913 Hmmm no. My Grandfather just got here from Poland in 1908.

However it is just the nature of yuppies to always want to manage and just run the numbers without doing any real f#kkin work. Multiply that by the banking industry and a fractional-reserve system. The results speak for themselves.

Investors suing Bank of America Corp. (BAC) and more than a dozen other underwriters to force the buyback of $6.7 billion in downgraded mortgage securities have defeated efforts by the banks in pretrial skirmishes to throw out the cases or move them from state courts.

A Washington state judge in Seattle said in rulings over the past two months that Bank of America, Goldman Sachs Group Inc. (GS) and other underwriters canít cite faulty data from appraisers or expired statutes of limitation to avoid Federal Home Loan Bank of Seattleís claims that there was false information in offering documents for at least $3.9 billion in securities it bought.

Bank of America tried unsuccessfully today to persuade a California state court judge that the statue of limitations had expired on claims in a lawsuit seeking to make underwriters repurchase $19 billion in mortgage-backed securities.

If the judgeís tentative ruling becomes final, it may open the door for investors to access internal bank files and e-mails about the loans in the pre-trial exchange of evidence, strengthening their bargaining position in any settlement talks.

ďAt each milestone it puts additional pressure on the defendant to settle,Ē said Isaac Gradman, an attorney and managing member of IMG Enterprises LLC, a mortgage-backed securities consulting firm in Petaluma, California, that advises clients on legal and contractual matters.